The average real estate commission in Colorado is right at the national average of 5.5%, according to a poll of FastExpert agents. So, if you’re looking at selling your home, you can expect to pay about $5,500 in real estate commissions for every $100,000 in a typical home transaction.
What’s Included in That 5.5%?
The real estate commission is typically split between the buyer’s agent and the seller’s agent, with each side getting 2.75% of the total sale price. So, if you’re selling your home for $300,000, the real estate commission would be $8,250, with each agent getting $4,125.
How is the Commission Paid?
The real estate commission is typically paid out of the proceeds from the home sale. Sellers are often the ones responsible for paying both the buyer’s agent and the seller’s agent commissions. This is just one more expense to factor in when you’re budgeting for your home sale.
What if You Don’t Use an Agent?
You don’t have to use a real estate agent when selling your home, but it’s generally not recommended. An experienced agent will be familiar with the local market and can help you price your home correctly from the start. A good agent will also help market your home and negotiate with buyers to get you the best possible price.
If you do decide to sell your home without an agent, you’ll still need to pay a buyer’s agent commission if the buyer is represented by an agent. In that case, you would be responsible for paying the full 5.5% commission.
Are Brokerage Commissions Tax-Deductible?
No, the IRS does not allow you to deduct other expenses associated with selling your home. Be sure to speak with a tax professional to see what expenses you may be able to deduct.commissions when you sell your home. However, you may be able to deduct some of the
What are the Duties and Responsibilities of a Colorado Real Estate Agent?
In Colorado, a licensed real estate broker is required to perform certain duties and responsibilities, regardless of the commission that is being charged. These duties include the following:
Agents for Seller/Landlord or Buyer/Tenant
A broker engaged by a seller/landlord or buyer/tenant to act as an agent is a limited agent in Colorado with the following duties and obligations:
(a) To perform the terms of the written agreement made with the seller/landlord or buyer/tenant;
(b) To exercise reasonable skill and care for the seller/landlord or buyer/tenant;
(c) To promote the interests of the seller/landlord or buyer/tenant with the utmost good faith, loyalty, and fidelity, including, but not limited to:
(I) Seeking a price and terms which are acceptable to the seller/landlord or buyer/tenant; except that the broker shall not be obligated to seek additional offers to purchase the property while the property is subject to a contract for sale or to seek additional offers to lease the property while the property is subject to a lease or letter of intent to lease:
(II) Presenting all offers to and from the seller/landlord or buyer/tenant in a timely manner regardless of whether the property is subject to a contract for sale or a lease or letter of intent to lease;
(III) Disclosing to the seller/landlord or buyer/tenant adverse material facts actually known by the broker;
(IV) Counseling the seller/landlord or buyer/tenant as to any material benefits or risks of a transaction that are actually known by the broker;
(V) Advising the seller/landlord or buyer/tenant to obtain expert advice as to material matters about which the broker knows but the specifics of which are beyond the expertise of such broker;
(VI) Accounting in a timely manner for all money and property received; and
(VII) Informing the seller or landlord that such seller/landlord or buyer/tenant shall not be vicariously liable for the acts of such seller/landlord or buyer/tenant agent that are not approved, directed, or ratified by such seller/landlord or buyer/tenant.
(d) To comply with all requirements of this article and any rules promulgated pursuant to this article; and
(e) To comply with any applicable federal, state, or local laws, rules, regulations, or ordinances including fair housing and civil rights statutes or regulations.
The minimum duties required to be performed by a real estate broker acting in the capacity of a transaction broker are set forth in Colorado §12-10-407, C.R.S., which states, in part:
(1) A broker engaged as a transaction broker is not an agent for either party;
(2) A transaction broker shall have the following obligations and responsibilities:
(a) To perform the terms of any written or oral agreement made with any party to the transaction;
(b) To exercise reasonable skill and care as a transaction broker, including, but not limited to:
(I) Presenting all offers and counteroffers in a timely manner regardless of whether the property is subject to a contract for sale or lease or letter of intent;
(II) Advising the parties regarding the transaction and suggesting that such parties obtain expert advice as to material matters about which the transaction-broker knows but the specifics of which are beyond the expertise of such broker;
(III) Accounting in a timely manner for all money and property received;
(IV) Keeping parties fully informed regarding the transaction;
(V) Assisting the parties in complying with the terms and conditions of any contract including closing the transaction;
(VI) Disclosing to prospective buyers or tenants any adverse material facts actually known by the broker including but not limited to adverse material facts pertaining to the title, the physical condition of the property, any defects in the property, and any environmental hazards affecting the property required by law to be disclosed;
(VII) Disclosing to any prospective seller or landlord all adverse material facts actually known by the broker including but not limited to adverse material facts pertaining to the buyer’s or tenant’s financial ability to perform the terms of the transaction and the buyer’s intent to occupy the property as a principal residence; and
(VIII) Informing the parties that as a seller and buyer or as landlord and tenant they shall not be vicariously liable for any acts of the transaction broker;
(c) To comply with all requirements of this article and any rules promulgated pursuant to this article; and
(d) To comply with any applicable federal, state, or local laws, rules, regulations, or ordinances including fair housing and civil rights statutes or regulations.
If you’re considering selling your home, contact a FastExpert agent in Colorado today. Our agents will help you through every step of the process, from listing your home to negotiating with buyers.
They have the experience and knowledge to get you the best possible price for your home. So, what are you waiting for? Simply enter your zip code below to get started!